21 Sep

Indian Institutional Framework

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Content

• Patent Act, 1970
  • Section 3D (What is not Patentable)
  • Section 84(1) (Compulsory Licensing)
• Indian patent regime and its clash with The US Norms
• Boosting patent ecosystem in India
• Copyright Act, 1957
• Copyrights act, 1957 and access to education
• National Intellectual Property rights policy

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A) Patent Act, 1970

Patent act defines what invention is and makes it clear that any existing knowledge of thing cannot be patented.

 Three prerequisites for patentability defined by the act:

• ‘Novelty’ standard
• ‘Non-obviousness’ or inventive step
• Industrial applicability

Discoveries are excluded from patent protection under section 3 of the Indian Patent Act.

• Discovery essentially refer to finding out something which already existed in nature but was unknown or unrecognized.

Contentious Provisions (Section 3(d) and Section 84(1))

 Section 3d (What is not patentable)

• Discovery of a new form of a known substance which doesn’t result in the enhancement of the known efficacy cannot be patented.
• Discovery of a new property or new use of a known substance cannot be patented
  • For e.g.
    • Ethyl alcohol acts as solvent, but further discovery of its new property as anti-knocking, thereby making it usable as fuel, cannot be patented.
    • New use of Aspirin for treatment of the cardio-vascular diseases, which was earlier used for analgesic purpose, is not patentable.
• The mere use of a known process, machine or apparatus unless such known process results in a new product or employs atleast one new reactant
  • However, a new and alternative process for preparing Aspirin is patentable

Aim of the provision under Section 3d: Prevent Evergreening

Why western countries are opposed to this

• The western countries are particularly opposed to this provision as it makes any small changes in the pharmaceutical industry non-patentable.

Does section 3(d) violate TRIPS?

• No
• It was further clarified by the Doha declaration on the TRIPS Agreement and Public Health in 2001
  • The declaration recognized the flexibility to member countries in circumventing patents rights for better access to essential medicines.
• Supreme Court of India: Novartis AG vs Union of India, 2013
  • Supreme court upheld the validity of Section 3(d) of the Patent Act.

Section 84(1) (Compulsory Licensing)

Provisions of the law:

any person may request a compulsory license if

• after three years from the date of grant of patent, the needs of the public to be covered by invention have not been satisfied.
• invention is not available to pubic at affordable price;
• or the patented invention is not “worked in”, or manufactured in the country, to the fullest extent possible

Compulsory Licensing – Basics

• Compulsory licensing is when a government authorizes a party other than the patent owner to produce the patented product or process, without the patent owner’s consent.
• In 2012 India Granted its first compulsory license to generic drug producer.
  • The decision effectively ended German Pharmaceutical company Bayer AG’s Monopoly over an anti-cancer drug and authorizes the production of a low-cost version for the Indian market.

Importance of Compulsory Licensing

• Promotes India’s status as “pharmacy of the world”
• Promotes “people’s accessibility to medicines”
• Benefits India’s fight against Drug Resistance TB, HIV, Cancer etc
• strengthen our soft power especially in African countries for whom India is a source of low-cost generic medicine.

B) The Indian Patent Regime and its clash with the US Norms (June 2022)

Why in news?

• The US Trade Representative (USTR) said in a report that India is one of the most challenging major economies as far as IP protection and enforcement is concerned. It has decided to retain India on its Priority Watch List along with six other countries – Argentina, Chile, China, Indonesia, Russia and Venezuela. (June 2022)

Key problems highlighted by USTR:

• Threat of patent revocation; Lack of presumption of patent validity and Narrow patentability criteria (Section 3(d) of the Patent Act) are issues which impact companies across different sectors.
• Waiting time for obtaining patents
• Reporting requirements
• Data Safety
• Judicial Delays: As per the report, even the 2015 Commercial Courts Act hasn’t been able to offer a solution to these delays. Moreover, abolition of Intellectual Property Appellate Board (IPAB) resulting in the redirection of courts has “created uncertainty around adjudication of IP cases and copyright royalty rate settings”.

What is India’s stand?

• Last year, the Parliamentary Standing Committee which undertook a ‘Review of the IPRs Regime in India’ and tabled its finding before parliament had following key things to say:
  • Section 3(d) acts as a safeguard against frivolous inventions in accordance with the flexibility provided in the TRIPS agreement. It prevents evergreening.
  • The committee also referred to the seminal judgement in the case of Novartis vs. Union of India, which upheld the validity of section 3(d). In this case In this case, pharmaceutical company Novartis filed a patent for the final form of cancer drug Gleevec, which was challenged in the Supreme Court.The Supreme Court held that Gleevec was merely a beta crystalline form of a known drug, namely, i matinib mesylate, and did not differ significantly in properties with regard to efficacy. Hence, it could not be patented in India
  • The committee also referred to TRIPS provisions, Doha declarations and public health exemptions to justify section 3(d).
  • The committee also indicated that India should resolve its differences with the U.S. regarding the disqualification of incremental inventions through bilateral dialogue.
  • India’s stand on Section 3(d) and Compulsory Licensing was justified when India and several other countries sought a temporary waiver of certain provisions of TRIPS agreement to deal with the COVID-19 pandemic and most developed countries kept on opposing it.
• ON IPAB abolition: The standing committee has said that the decision should be reconsidered, in wake of its pivotal role in the adjudication of IPR appeals and cases. It recommends that rather than being abolished, it should be empowered and strengthened with more structural autonomy, infrastructure, and administrative reforms, while also ensuring that the required officials and staff are appointed in a timely way.

Conclusion: While some of the issues like Judicial delays and delays in patent offices of India are genuine and India should work towards resolving them, the other issues like limitation on patentability are more focused on the interest of US pharma industries, rather than on public welfare and can be ignored.

C) Boosting Patent Ecosystem in India

Introduction:

The recent report of the Economic Advisory Council to the Prime Minister (EAC-PM), Why India Needs to Urgently Invest in its Patent Ecosystem highlights the significance of a robust patent system for a knowledge economy and for the promotion of technological innovations. (Sep 2022)

Current Situation of Patent filings in India:

• Number of patent applications filed in India have doubled during the last decade.
• For the first time, the number of patent applications by residents have surpassed that of a foreign application during the last quarter of FY 2021-22.
• Higher Education Sector of India is rising in prominence in the research and development spending and patenting landscape of India.
  • The share of this sector in the gross domestic expenditure on R&D (GERD) has increased from 5% in 2013 to 7% in 2018.
  • The number of patent applications filed by the top 10 academic institutes and universities in India rose by more than two times in four years, from 838 in 2015-16 to 2,533 in 2019-20.

Key Problems in Patent Ecosystem:

• Long Pendency of processing Patent applications:
• Drastic increase in the number of abandoned patent applications: The share of such abandoned patents application soared from 6% in 2010-11 to 48% in 2019-20.
  • Abandoned application refer to those applications where refiling of documents hasn’t happened after patent examiner finds the original documents not enough to meet the requirements.
  • This may be due to the fact that applicants are not confident about their applications passing scrutiny and, therefore, do not pursue their applications.
  • Another reason may be the creation of perverse incentive for filing of Patents after the IPR Policy 2016. Innovators may have filed applications even when they knew that their claims may not pass scrutiny.
• Decreasing Industry-Academia collaboration: Though, our ranking in Global Innovation Index has improved over the last few years. But India’s score on the indicator of Industry-Academia collaboration has declined and thus, India’s rank on this indicator has also deteriorated.

Way Forward:

• Increasing efficiency of processing patent applications.
  • Increased human resource
  • Fast tracked scrutinization process
• Examining the patent ecosystem to understand the reasons for large number of abandoned applications.
• Increased Industry-Academia Collaboration: Currently, it is limited to niche research areas that have low commercial significance.
• Other General steps:
  • Better implementation of IPR policy
  • Brining an innovation led ecosystem at schools, HEIs etc.
  • Prioritizing commercialization of the patents

Conclusion:

• The Patent system is a critical aspect of the national innovation ecosystem, investing in the patent ecosystem will help in strengthening the innovation capability of India.
• Right interventions should be made for the promotion of the quality of patent application and collaboration between academia and industry.

D)  Copyright Act, 1957

It was the first copyright act in Independent India, it has been amended six times by now.

Copyright Act 1957, and the Copyright Rules 2013, as last amended in 2016 are two laws that govern copyright in India.

Key highlights

• Types of Work Protected: Literary, dramatic, musical and Artistic
• Duration of Protection:
  • Lifetime of the author + 60 years from the beginning of the next calendar year next following the year in which the author dies.
• Foreign Work: Copyrights of work mentioned in the International Copyright Order (WIPO) are protected in India, as if such work is Indian work.
• Ownership
• • Author
  • For work done in author’s employment under a “contract of service” or apprenticeship, the employer is considered the first owner of the copy right, in the absence of any agreement on the contrary.
• Exemption to Copyright infringement in India
  • Fair dealing with any copyright work for certain specifically mentioned purposes and
  • Certain specific activities enumerated in the statute.
    • Exception for the educational use of copyright materials, including their production “in the course of instruction“.
• Remedies available against copyright infringement in India
  • The act provides three kinds of remedy
    • Administrative remedies
      • Detention of the infringing goods by the custom authorities
    • Civil Remedies
      • Injunctions, damages and account of profits
    • Criminal Remedies
      • Imprisonment (up to 3 years) along with a fine (up to 200,000)
• Enforcement Authorities
  • Civil Court
  • Criminal Court -> for criminal infringement
  • The Copyright Board constituted under the act -> it provides an alternative forum for resolving certain limited disputes, such as those pertaining to assignments and payments of royalties.

E) Copyrights Act, 1957 and Access to Education

Introduction:

• Fair dealing provisions under the Copyright Act 1957 is trying to maintain a balance between the IPR regime and access to education. Section 52(1)(i) allows the reproduction of any work by a teacher or a pupil in the course of instruction.

2016 Delhi High Court Verdict in the DU Photo Copy case

• The court dismissed a suit initiated by major publishing houses, which had sued the Delhi University and Rameshwari Photocopying Services, a kiosk inside the Delhi School of Economics.
• The suit complained copyright law was being violated because of the photocopied course packs.
• But the Delhi High Court dismissed the suit saying that the photocopying of the course packs didn’t amount to infringement of copyright.
• It said “Copyright is intended to increase and not impede harvest of knowledge. It is intended to motivate creative activity of authors in order to benefit the public.”
• The court said that photocopying for academic purposes is not an infringement as Section 52(1)(i) allows the reproduction of any work by a teacher or a pupil in the course of instruction.
• The court further held that ‘course of instruction’ therein is not confined to the time and place of instruction, and would include anything that could be justified for the purpose of instruction. Further, the court also said that there is no quantitative restriction on the extent of reproduction permitted.

Key highlights of the Parliamentary Standing Committee Report, 2021 on ‘Review of the IPR Regime in India’.

• The committee has suggested curtailing fair dealing provisions under the Indian Copyright law as it is leading to detrimental impact on publishing industry and authors who are mainly dependent on royalties.
• It calls on the government to amend the Section 52 to allow for such copying only in government owned institutions. It also says that there should be quantitative limit on how much copying is permissible and regulation of the storage of the copied work.

Criticism of the Committees view

• The committee fails to understand that the true purpose of copyright law is to ensure easy access for education.
• The role of “fair dealing provision” within this framework.
• Right to education is one of the constitutional rights and hence the importance of “fair dealing provision” norms can be traced to the Constitution.
• In long run, the copyrighted material doesn’t curb the market for books but enhance it.
• Further, introducing quantitative restrictions would lead to arbitration (as any limit would be arbitrary)

Analysis: Positives of the 2016 High Court verdict

• Relief for both teachers and Students
  • If students are asked to buy new books for each of their readings, the education would become unaffordable for many of them.
• This is in line with technological progress and should be appreciated as it provides students with all the relevant material that may otherwise be out of reach.
• Quality of higher education is not compatible with overzealous copyright law.
• Some even argue that course pack pump up publisher revenues in the long run by popularizing authors to students who may otherwise have never heard of them.

 Analysis: Negatives of the Delhi High Court Verdict

• Discouragement for reputed publishers.
• there should be a balance between the interest of education, students, teachers on one side and publishers on the other side.
• Krishna Kumar, a former NCERT chairman, argues that the decision encourages students to merely photocopy and skirt the more laudable aim of reading full books.

Other issues which popularity of course packs bring forward

• Lack of good libraries and enough number of books in the libraries.
• These course packs are exam centric only.
  • Students cannot enjoy revisiting a text later in student life and beyond.
  • It contains material only relevant for the exams and thus the joy of reading and learning is lost.
• Some experts feel that photocopying as a legitimate substitution for library holding will perpetuate India’s academic poverty.

Conclusion: Copyright law should be suitable for Indian realities and its development needs of making the access to education more equitable and fairer in a context of deepening socio-economic inequalities.

Example Question:

Discuss the key provisions for Copyrights Act, 1957. How has the recent amendment to Copyright Rules 2013 strengthened the Copyright regime in India. [10 marks, 150 words]

Copyright is intended to increase and not impede harvest of knowledge; it is intended to motivate creative activity of authors in order to benefit the public. In light of the previous statement discuss the key provisions of Copyrights Act, 1957. Does this law fulfil the above goals? Give reasons [15 marks, 250 words]

F) National Intellectual Property Rights Policy

• The policy approved in May 2016, lays down the future roadmap for intellectual property in India.
• The Policy recognizes the abundance of creative and innovative energies that flow in India, and the need to tap into and channelize these energies towards a better and brighter future for all.
• The Policy recognizes that India has a well-established TRIPS compliant legislative, administrative and judicial framework to safeguard the IPRs, which meets its international obligations while utilizing the flexibilities provided in the international regime to address its development concerns. It reiterates India’s commitment to the Doha Development Agenda and the TRIPS agreement.

Vision Statement

• An India
  • Where IP stimulates creativity and innovation for the benefit of all.
  • Where IP Promotes advancement in S&T, arts and culture, traditional knowledge and biodiversity resources;
  • Where knowledge is the main driver of development and knowledge owned is transformed into knowledge shared.

Objectives

The policy lays down the following seven objectives.

• IPR Awareness: NIPR policy comes with the most important motive of increasing awareness about social, cultural and economic benefits of IPR among all sections of society.
• Stimulate generation of IPRs -> maximize the number of IPRs being filed.
• Commercialization of IPRs to get value through them.
• Legal and Legislative Framework – To have strong and effective IPR laws, which balance the interests of rights owners with larger public interests.
• • For e.g. India doesn’t have law on trade secrets, the policy aims to create specified laws on it.
• Administration and Management – To modernize and strengthen service-oriented IPR administration.
• Enforcement and Adjudication – To strengthen the enforcement and adjudicatory mechanism for combating IPR infringements
• Human Capital Development – To strengthen and expand human resources, institutions and capacities for teaching, training, research and skill building in IPRs.
  • The policy focuses on recruiting people and training them in order to address the pendency of cases.
• The Policy also recommends that IP be taught in schools and colleges.

Key Provisions of IPR Policy

• Financial Support to less empowered groups of IP owners such as farmers weavers etc through financial institutions.
• Fast track IPR process: Reducing the time taken to clear backlog of IPR applications (to 3 months) and Trademark application (1 month)
• Incentivize and simplify IP registration further for start-ups.
• DIPP to be nodal department to coordinate, guide and oversee IPRs in India
• Updating laws like Indian Cinematography Act, to remove anomalies and inconsistencies in consultation with stakeholders. The policy recommends unauthorized copying of movies be criminalized.
• Reviewing the policy every five years.

Way Forward:

•  Implementation
•  Strengthen institutions
• An environment of innovation
• Awareness, Education about IPR and advantages

Example Questions

• Discuss the key vision and objectives of the National Intellectual Property Right Policy [10 marks, 150 words.]
• “The National Intellectual Property Rights Policy, 2016 recognizes the abundance of creative and innovative energies that flow in India, and the need to tap into and channelize these energies towards a better and brighter future for all” Critically Analyze [10 marks, 150 words]